Reading Financial Statements for Lawyers, Part 2
A deep understanding of financial concepts, statements, and how they relate to major and routine business transactions is essential knowledge for all attorneys advising businesses. This understanding is necessary to negotiate and structure transactions, and to draft the underlying documents. This two-part program will help business transactional attorneys marry legal learning with financial understanding to better serve clients. It will discuss major financial concepts and how they specifically relate to, and sometimes create traps in, major and routine business transactions, including business mergers, commercial borrowing, and the sale of business ownership interests.
Day 1 – April 6, 2010:
- Overview of major concepts for business transactions, including corporate M&A, bank loans, and sales of business ownership interests
- Understanding the components of a company’s capital structure
- Differences between accounting books and tax books, and how the difference effects sales of business interests
- Depreciation, amortization, and how they effect income and cash flow statements
- Understanding EBITDA, intangibles and more
Day 2 – April 7, 2010:
- Relationship between financial issues and key provisions in business transactional documents
- Cash flow v. operating income traps and tricks, and how they impact earnouts
- Book v. market value in buyouts, and valuation
- Early warning signs of financial distress and drafting triggers
- How to build in regular financial reporting in transactions
- Working with auditors & understanding audit standards
Paul Kaplun is a partner in the Washington, D.C. office of Venable, LLP where he has an extensive corporate and business planning practice, and provides advisory services to emerging growth companies and entrepreneurs in a variety of industries. Mr. Kaplun formerly served as an Adjunct Professor of Law at Georgetown University Law Center, where he taught business planning. Before entering the private practice of law, Mr. Kaplun, a Certified Public Accountant, practiced in the Washington, D.C. office of a Big Five public accounting firm specializing in corporate and individual income tax planning and compliance. Mr. Kaplun received his B.S.B.A., magna cum laude, from Georgetown University and J.D. from Georgetown University Law Center.
